Chapter 18 - The Goods market in an Open Economy Flashcards
1
Q
J-curve
A
the adjustment process in the trade balance in response to a real depreciation
2
Q
an increase in investment must be reflected
A
either in an increase in private saving or public saving or in a deterioration of the the current account balance
3
Q
a deterioration in the government budget balance must be reflected
A
in an increase in either private saving, or in a decrease in investment, or else in a deterioration of the current account balance
4
Q
a country with a high saving rate must have
A
either a high investment rate or a large current account surplus